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BOOK REVIEW: Why Nations Fail

The book, “Why Nations Fail” is the first book that I got as a Political Science university
student. This book is a product of Daron Acemoglu and James A. Robinson taking up the
question of why there’s so much variation in wealth worldwide. One that interests me in this
book is its antithesis on geography as a reason for the relative success of nations. In this book,
other elements, like as ignorance and culture, were also dismissed as major causes of nation.
In today's foreboding economic environment, the average American is clearly seven
times wealthier than the average Mexican, ten times wealthier than the average Peruvian, about
twenty times wealthier than the average resident of sub-Saharan Africa, and about forty times
wealthier than the average citizen of such especially impoverished African nations as Mali,
Ethiopia, and Sierra Leone. In reality, there is the idea of a separation between the Global North
and the Global South in terms of wealth and development, much as we encounter in theories with
the division of rich-poor nations. To illustrate how the globe was geographically divided between
comparatively wealthier and poorer countries, the Brandt Line was created in the 1980s.
The book's authors, Acemoglu and Robinson (AR), are both academics who disproved
the conventional social-science explanations for the persistence of poverty, which variously
attribute it to unfavorable geographic circumstance, impeding cultural norms, or uninformed
politicians and technocrats. Instead, the "Why Nations Fail" focuses on the historical trends and
pivotal moments that shape contemporary polities. Given the extensive labor that went into
condensing this material, the author's point of view in this book is clearly legitimate. It's only
that the book gives a historical overview of how nations came to be as they are now, followed by
explanations of the divide between wealthy and developing nations. In addition to its solid basis
and comparison, the book often cited Jared Diamond's "Guns, Germs, and Steel," which won the
Pulitzer Prize.
Through proposing that European geography and ecology, rather than cultural or racial
distinctions, gave Europeans the upper hand over poorer nations in terms of "power and
technology," Diamond has significantly advanced this issue. The Geography Hypothesis, which
holds that geography and climate have little bearing on a country's economy, was refuted by AR.
This distinction is particularly intriguing since, according to Diamond's comprehensive study
spanning 30 years, several countries have advanced significantly as a result of their ability to
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avoid devoting resources to "hunting" and instead concentrate on forging their own identity.
Through then, it is noted that since they had developed technology, the Europeans were able to
conquer the less developed nations. And while European countries embraced cutting-edge
technology, the less developed countries still spent days out hunting and collecting for food.
I agree that location and climate has a large influence on a nation's prosperity by
providing them a substantial head start in concentrating on newer technologies, but does this
account for why other countries are still falling behind despite these technologies being
available? As someone who lives in a country with rich resources but has failed to utilize it, I
somewhat conclude that geographical fortune will only be significant depending on how it is
used and developed.
Furthermore, the Extractive & Inclusive Institution is emphasized throughout the book as
a repeating concept. Institutions that allow the wealthy to govern over and exploit others while
siphoning off their riches are referred to as "extractive." It was said that nations fail when they
have extractive political and economic systems that hinder or even prevent economic progress. In
light of this, it was recommended that we adopt an inclusive institutional framework in order to
create a thriving country. This is due to the fact that a country's leader is often more concerned
with maintaining the riches inside a "virtuous loop," extractive institutions are considered
harmful to a country's development, advancement, and future.
By means of extractive institutions, a number of nations are now seen as "failures."
Zimbabwe is one of several instances, whose government has repeatedly reaffirmed its role as an
extractive institution by establishing networks in which the same individuals profit economically.
The concept of inclusive and extractive institutions proposed by AR makes a lot of sense
since it demonstrates how inclusive institutions enable the nation to participate in society and the
economy, but extractive institutions do not assist those who are not within the "circle." However,
the limit of extractive institutions is one issue that has to be addressed. As already said, China
managed to surpass the United States as the second-largest economy in the world despite the fact
that it is still a communist nation governed by corporations.
Additionally, the writers of the book did a good job of conveying facts about other
nations and how rich they are. One of the nations in the book with inclusive institutions was
Botswana. Due to the modernization of the political and economic institutions that sparked
Botswana's advancement, the country has defied the odds to become one of the most prosperous
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in Africa. In the chapter titled "Breaking the Mold," the writers gave a great description of how
Botswana matches the definition of an inclusive institution. This chapter discusses how, after
independence, Botswana "rapidly created inclusive economic and political systems. Since that
time, there have been no civil wars or military interventions, and it has consistently held
democratic elections with a high level of participation. The establishment of economic
institutions by the government to protect property rights, provide macroeconomic stability, and
promote the growth of an inclusive market economy
Additionally, although the author has provided a description of the settlement of North
America, he neglects to acknowledge the significant contribution made by the hundreds of
thousands of slaves who were brought to this region to start constructing the US's economy,
which led to a prosperous country based on free labor.
Finally, but certainly not least, political geography views the geography hypothesis as a
belief that wealth is predicated on location and climate. The geography hypothesis' central
finding is the correlation between economic success and having access to natural resources. It
is believed that the presence of some environmental elements is a need for economic growth,
while their absence is said to impede or even prevent advancement. Some nations were only
fortunate enough to create countries on places endowed with a nice environment, according to
the geography hypothesis most persuasively put out by Jared Diamond in Guns, Germs, and
Steel.
In this instance, there's a reason why the world's poorest nations are situated in tropical
areas and the richest nations are found in climatically colder locations. Simply explained,
tropical regions of central Africa and America are more prone to see the onset of illnesses,
therefore it is only reasonable to anticipate that a Zambian will be far less productive than a
Norwegian. Ask Acemoglu and Robinson, however, why adjacent nations like North and
South Korea are so unlike. Furthermore, despite being in the tropical climatic zone, why is
Singapore so successful?
Then, AR discussed the many hypotheses—namely, the culture hypothesis and the
ignorance hypothesis—that describe what makes a nation prosperous. Religion, beliefs, values,
and ethics are the foundation of the culture hypothesis idea of prosperity. The idea that the
leaders of impoverished countries simply do not understand how to create a prosperous nation
is known as the "ignorance hypothesis."
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Cultural theory is the only one with which I agree since a nation's value system
establishes its framework. The culture hypothesis postulates that certain people's cultural and
religious backgrounds just make them more likely to work than others. For instance, the
Philippines' value system places a strong emphasis on family and religion. As a result, these
ideas become the populace's opium. The family is prioritized in Filipino culture, which
prevents family members from growing personally.
I find reading "Why Nations Fail" to be both entertaining and thought-provoking, even
if I agree with some of the book's logical conclusions. The basic idea of the book is that if you
want to have a rich and thriving society, you must also have inclusive institutions and
centralized political authority. There is a limit to how centralized it should be, however, since
economic operations are too intricate.
In the end,as a free citizen of the Philippines, I would somewhat affirm that economic
prosperity depends on the inclusiveness of the political and economic institutions of a country.
A nation will be better off if more individuals participate in political and economic
decision-making. Because they enable individuals to freely pick their vocations and the market
to lead the nation on a successful path via its invisible hand, inclusive institutions thrive.